The US Supreme Court has decided not to hear Microsoft's appeal in the Eolas patent lawsuit.

Microsoft has a $520.6 million judgement against it from two years ago, but has appealed on several fronts.

The Supreme Court decided not to hear Microsoft's argument relating to how damages in the case should be calculated. It said they should apply only to US products rather than all sales. The Supreme Court did not give a reason for its rejection.

Now the case's focus shifts to the district court of Chicago, which is examining the validity of the Eolas patent.

This patent question is the last major decision before the courts, said a spokesman for the Eolas side. "There's not an outstanding question now of infringement or damages," he said. "There's just a question of whether the patent is valid or not."

Microsoft was defiant. "We will continue with the trial of the remanded case before the District Court and we're confident that our position will ultimately prevail," a spokesman said.

Last month, the US Patent and Trademark Office finished a re-examination of the Eolas patent and concluded that it is valid.

This legal dispute has been ongoing since 1999, when Eolas sued Microsoft, claiming that technology within Internet Explorer violated a 1998 University of California patent developed by Eolas founder Michael Doyle.

Eolas has exclusive rights to use and license the patent, which describes, in part, "a system allowing a user of a browser program ... to access and execute an embedded program object".